FAQ

Q: How will rUSD maintain its peg? How will the protocol stay solvent?

A: Reservoir provides a peg stability module that allows anyone to convert rUSD to USDC at parity and at no cost. rUSD issuance will be calibrated to avoid any liquidity crunch scenario. An important aspect of the rUSD peg is the assets that collateralize the stablecoin protocol. With a healthy mix of liquid DeFi assets and RWA collateral, the protocol provides a significant differentiating factor in higher yields and how uncorrelated and more stable it is to the digital asset market.

Q: How does the protocol manage periods of high market volatility?

A: The multicollateral approach to the Reservoir balance sheet creates flexible infrastructure to keep yields at or above market rates. Through lending rate and funding rate exposure, Reservoir is able to capture bull market yields. During bear markets or slow periods, Reservoir is able to obtain exposure to more consistent, risk averse yields such as Treasury bills offchain.

Q: How does the protocol safely store and manage funds? A: Reservoir uses Gnosis Safe and institutional MPC wallets to custody, transact, and set parameter changes onchain.